Phasing out of Plan F and its Consequences

Introduction

Medicare Supplement Plan F has been the all-time overwhelming favorite among the citizens. Its popularity can be assessed from the fact that in 2017, Plan F comprised 57% of the total Medicare Supplement plans sold. The plan provides the most comprehensive coverage among all the Medigap plans being offered. The Plan F provides 100% coverage to the customers and even covers the deductible for the Part B. This means that there are no out-of-pocket expenses for the customers. However, the federal government has decided to discontinue the Plan F from January 1, 2020, for new customers. The details of the Plan F being discontinued and how the customers can look for suitable alternatives are provided below:

As a part of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), the federal government is eliminating all the Medigap plans which cover the deductible of Part B like the Plan F and Plan C. From January 1, 2020 new customers will be unable to purchase the Plan F. The customers who have purchased the plan before this date can continue to hold it and avail its benefits. The general consensus among the policymakers is that the customers having Plan F visit their healthcare service providers far too often compared to someone who pays their own deductible. Holders of Plan F visit their doctors for minor health problems which would not have been the case if they had to pay their Part B deductible.

Impact on Existing Policyholders

The existing policyholders will not face any immediate impact due to the Plan F being discontinued. They can continue to keep their Medigap Plan F and avail its benefits. However, with time it is expected that the premium for Plan F will rise steadily as the annual enrollment in it will shrink. The increased premium can have significant monetary impact on the existing policyholders. They can plan to move to other worthy alternatives to Plan F.

Best Alternative to Plan F

The best alternative to the Plan F is the Plan G. Due to the awareness that Plan F will be discontinued, more people have been enrolling in Plan G which is reflected in the increased sales figure. The Plan G covers all the items covered by the Plan F with the exception of the Part B deductible. The Plan G is the worthy alternative to the Plan F and provides a like to like replacement for the same.